Survey Finds U.S. Manufacturers Optimistic Despite Challenges

Chicago – Eight out of 10 U.S. manufacturers expectto grow sales thisyear, buoyed by their optimism about the strengthof regional, national and globaleconomies, according to the 2019 NationalManufacturingSurvey Report prepared by Leading Edge Alliance (LEA), a global association of 220 accounting and consulting firms.

“Across the board, manufacturers are optimistic about the regional economy, sector growth, and increasing revenue expectations in2019,” the reportstates. “Looking ahead, manufacturers expectraw materials, labor costs,lackof available talent and competition to be significant hurdlesin 2019. The tariffs implemented by President Trump provide productivity issues;however, an increasein spending onBig Data and business intelligence are delivering innovative technology for minimizing productivity concerns.”

More than 350 manufacturing executives participated in the survey, which includes respondents who produce industrial/machining; transportation/automotive; construction; food and beverage; and other products.

2019 Survey Highlights

Growth: 81% of manufacturers expect their revenue to increase in 2019, and 61% expect their overall sector to expand in 2019.

Economy: Optimism for the regional, national and globaleconomieshasincreasedby more than 12 percentage points over the last two years.

Priorities: Manufacturers’ top three priorities are growing sales, improving profitability and addressing the workforce shortage.

Challenges:Most manufacturers (52%) cited labor/talent as their greatestbarrier to growth, followed by competition (34%) and profitability (25%).

The survey identified three key growth strategies manufacturers will use to keep their companieson a growthtrack: Technology, mergers and acquisitions, and talent management.

Technology:Manufacturers plan to leverage technology as key to solving productivity concerns; 76% said that they will investigate/prioritize cybersecurity in 2019, and 43% said they will prioritize BigData/ERP/IoT.

M&A: More manufacturers are considering a merger/sale or acquisition in 2019; 21% expectto acquire another business in 2019 and 16% are in the pre-planning stageof a merger or acquisition.

Talent:Faced with a growing labor shortage, manufacturers have turned to a rangeof tools to improvehiring and retention with 62% increasing compensation, 39% implementing retentionstrategies and 35% using internal trainingprograms.

“The challenge of gaining a competitive advantage remains critically important,”thereport says. “We believe the resilience andsuccess our manufacturing clients have created for themselves will help alleviate the major concerns for 2019.”